Inequality for All Page #4

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shed workers as they automated.

And we have this romantic idea

that we can get

manufacturing back.

But you get manufacturing plants

back,

and they're filled

with robots and computers.

The old assembly line is gone.

I was one of the earliest

investors in amazon.com.

I consider amazon.com

to be one of the greatest

economic achievements

of our time

and certainly something

I'm incredibly proud of.

But make no mistake:

Amazon.com employs 60,000 people

and does $70 billion,

$80 billion in sales.

But if mom-and-pop retailers

were doing

that $70 billion or $80 billion

in sales,

it would be 60,000 people

employed doing it.

It'd be 600,000

or 800,000 or a million people

because those business models

are so much less efficient.

So Amazon created

a huge economic windfall

here in the Pacific Northwest,

but all over the country,

there are people

who are no longer employed

in selling stuff

who are not happy.

As a manager for Circuit City,

it was a look behind

the curtain, so to speak,

as a manager, to see exactly

how everything worked.

So when you got laid off,

did you see it coming,

or was it sudden?

They did several layoffs

while I was there.

People who had been there

too long:

"They're making too much money

"because they've

been there too long,

and we're gonna have to do

something to cut the payroll."

The hardest part was thinking,

"Is it gonna happen to me?"

Until I became a student,

it was pretty dicey.

I mean, it would have been

easy for me

to just fall into depression,

which happens

to a lot of people,

or go for a lower-paying job,

which would have

put me in a worse

financial situation.

Looking back on it,

you can see the pattern.

It's not as easy to see

when you're in it,

but the signs were there.

I mean, there was

a major slowdown in business,

and I think a lot of that

had to do

with things like Amazon.

Because I've been in retail

for so long,

I don't go through

the automated checkout lines.

And one of the main reasons

is because I know

that every time

I go through that,

it's taking a little bit

of someone's job away.

It's not that I think

that I'm going to...

save their jobs

in the long run.

But I know

that I'm gonna slow down

the transition a little bit

so that maybe

they're gonna have

a little bit longer

to get ready for the transition.

Contrary to popular mythology,

globalization and technology

haven't really

reduced the number of jobs

available to Americans.

These transformations

have reduced their pay.

I mean, it's not just

that wages are stagnating,

but when you take

into consideration

rising costs...

the rising costs of rents

or homes,

dramatically increasing costs

of health care,

the rising costs of child care,

and also the rising costs

or higher education,

rising much faster

than inflation...

Take all of these

into consideration,

and you find

that it's much worse

than just stagnating wages.

It's basically

middle-class families,

often with two wage earners,

working harder and harder

and harder

and getting nowhere.

I work at a law firm

as a litigation assistant.

And Moises?

I work as a bus operator.

Do you know how much is

in your bank account right now?

Mine is less than 100 bucks.

So I want to say maybe $80.

Yeah, yesterday

it was only $30.

And that's with us working.

Yeah.

Car insurance, $125.

Kids' World, $150.

Rent, $1,375.

We felt like we had

to write it all down,

because how could we

not have money?

We make money.

You know, I'm working now.

We don't know how much

we're gonna be paying on that.

The Y.

This is my money that I donate.

$16 a month

to Children International.

We don't even have here

my UCSF bill.

Remember that hospital bill?

It's, like,

200 and something dollars

that's not even here

that we need to pay.

Oh, yeah.

What about savings?

We haven't been able to.

We don't have

a savings account.

- I took it off because it...

- It wasn't working.

Oh, you brought your glove.

Did you guys play baseball?

And she's been playing with you?

When she was born,

we had no money.

The refrigerator was empty.

The freezer was empty.

I said, "This is not the way

I want to raise my daughter."

- How was your day?

- Good.

I've seen single mothers

work three jobs

just to be able to pay rent.

And I didn't want that.

So I started going to school.

How do you build wealth?

Not that I want to be wealthy.

I just...

How do you do it?

How the heck

do you build wealth,

like, when you don't

have anything,

when you don't have any assets,

when you don't have nothing?

This is gonna be Mommy's office.

Look.

This is gonna be my office.

It's not my office yet,

but it's going to be my office

really soon.

Hmm?

People, I think,

would be less concerned

about inequality

of income and wealth

if everybody had a chance

to make it.

As long as there's

upward mobility,

as long as anybody

with enough guts and gumption

and hard work

can make it in America,

can move up the income ladder,

then we don't have a problem.

But as income inequality rises,

upward mobility is actually less

than it was before.

- Come on.

- You want to see the rest?

Yeah.

In the United States,

42% of kids born into poverty

will not get out.

Compare that to Denmark,

where only 25% of kids

born into poverty stay there.

Even Great Britain,

a country that still has

an aristocracy,

has more upward mobility

than we do.

You know,

people occasionally say to me,

"Okay, Reich, if you think

it can be done better,

"what nation does it better?

Whom should we emulate?"

And the answer is

the United States.

In the three decades

after World War II,

a period that I call

"the Great Prosperity,"

the economy boomed,

but not only

did the economy boom,

but you had very low inequality.

We made education

a national priority,

particularly higher education.

By 1940,

only 5% of adult Americans

had a four-year college degree,

but that percentage

began to explode.

The GI Bill paid college costs

for those who returned

from war,

and the subsequent expansion

of public universities

made higher education

affordable to many.

By the late '50s, we had

the best-educated workforce

of any country in the world.

We also had labor unions.

By the mid-1950s,

more than 1/3 of all workers

belonged to a union.

This gave average workers

bargaining leverage

to get a larger share

of the growing pie.

We created

the largest middle class

the world had ever seen.

And that middle class

was part of a virtuous cycle.

The wider their prosperity,

the more people were included

in that prosperity,

the more that prosperity

generated more prosperity.

Hello.

Okay, now,

they're gonna be calling in

momentarily.

From American Public Media,

this is Marketplace.

America's already

making it harder

for young people of modest means

to attend college.

41 states are cutting spending

for public higher education,

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